Australia Consumer Confidence August 2017

Australia: Consumer sentiment continues to slide in August

August 9, 2017

The Westpac-Melbourne Institute Index of Consumer Sentiment came in at 95.5 in August, down 1.2% from June’s 96.6. The index thus fell further below the 100 mark, indicating that the number of pessimists outnumbers optimists.

Consumers continue to be worried about their finances as wage growth continues to disappoint and interest rate hikes become more and more likely in the near future. That the RBA postponed any interest rate hike at its last monetary policy meeting did little to alleviate consumers fear, as did the increasingly buoyant labor market. Consumer expectations were more upbeat, however, thanks to the improving outlook of the economy.

FocusEconomics Consensus Forecast panelists see private consumption growing 2.4% in 2017, which is unchanged from last month’s forecast. In 2018, panelists also see private consumption expanding 2.4%.

Australia’s economy slowed considerably in the third quarter, dragged down by a sharp slowdown in consumer spending, according to figures released by the Australian Bureau of Statistics (ABS) on 5 December.

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